Two people are facing federal charges for allegedly defrauding Chinese investors of more than $26 million who they believed were investing in real estate in the Dallas-Fort Worth area.
Steven Wall, 65, and Saskia Bedoya, 42, are charged with one count of conspiracy to commit wire fraud in an indictment filed Tuesday, the U.S. Attorney's Office for the Northern District of Texas announced in a news release. He was charged with one count of securities fraud and one count of securities fraud. The FBI's Dallas Field Office conducted the investigation, according to the release.
Mr. Wall and Mr. Bedoya are scheduled to appear before a magistrate judge on Dec. 22, but neither attorney is listed in federal court records.
According to the release, the two conspired with Timothy Lynch Burton to market real estate investment opportunities in Texas to Chinese investors. Burton was indicted last September on seven counts of wire fraud, one count of conspiracy to commit wire fraud, and one count of securities fraud. These charges are still pending.
Earlier this month, a U.S. District Court ordered several companies owned by Mr. Barton to be placed in receivership at the request of the Securities and Exchange Commission. According to the SEC, a receivership is when a court appoints a receiver or independent third party to protect property controlled by a person who is being sued in a lawsuit. The SEC typically recommends appointments when a company or individual is concerned that “corporate property or assets may be dissipated or wasted.” The trustee's job is to manage the company's finances and help pay creditors.
The SEC alleges that Burton, president of JMJ Development and CEO of investment firm Carnegie Development, defrauded more than 100 Chinese investors.
In a presentation to investors, federal authorities said Burton and Wall claimed the property was located in a “popular area of the Dallas-Fort Worth metropolitan area.” Wall was described as a builder who buys construction sites and sells them to home buyers, according to the release.
According to the indictment, Barton, Wall and others began traveling to Hangzhou, China, around 2017 to pitch investors on real estate opportunities in the United States. In the presentation, investors were told that they would fund 80% of the cost, with Barton and Wall contributing the remaining percentage. They also told investors that their funds would not pay them fees, according to the indictment.
According to the release, loan agreements signed by investors inflated property prices by up to 195%, and some investors did not actually purchase the properties. Early investors were paid interest on investor funds from subsequent projects, authorities said.
Authorities allege those involved in the scheme paid fees from investors' funds and funneled them into unrelated projects in violation of agreements. The indictment also alleges that participants in the scheme used other funds to pay consultants and pay bills to an unrelated company, American Express.
Chinese investors who agreed to finance the development deal moved in April 2020 to force the hundreds of acres of projects in several North Texas counties into bankruptcy. Chinese businessman Haoqiang Hu, 49, was also charged in connection with the scheme and pled guilty to selling unregistered securities in October 2022, the prosecutor's office announced. Mark Adams, 61, pleaded guilty in September 2022 to conspiracy to commit wire fraud in connection with the scheme.
Last year, the SEC charged Mr. Burton, Mr. Wall, and Mr. Hu with violating securities laws. Mr Barton appealed the action and denied any wrongdoing.
Adams and Hu are scheduled to be sentenced on February 21, according to their attorney's office.
